Nigeria Joins 71 Countries To Combat Tax Evasion

Nigeria has joined 71 other countries to combat tax evasion as the Federal Inland Revenue Service (FIRS) has signed two major multilateral instruments.

These instruments are the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (MLI) and the Common Reporting Standard (CRS) Multilateral Competent Authority Agreement‎ (CRS MCAA).

Chairman, Mr. Tunde Fowler, Managing Director of FIRS signed the agreements on behalf of Nigeria in Paris, with Mr. Ben Dickinson, head of global relations and development division of the Organisation for Economic Cooperation and Development (OECD), in attendance.

A statement issued by Pascal Saint-Amans, director of the OECD Centre for Tax Policy and Administration (CTPA), said the signing of the agreements makes Nigeria the 71st jurisdiction to sign the MLI and the 94th jurisdiction to join the CRS MCAA.

The agreements will give Nigeria automatic exchange of tax and financial information among 101 tax jurisdictions and enhance the country’s ability and those of the other countries to contain tax avoidance and evasion as well as share financial data.

The MLI is a legal instrument designed to prevent Base Erosion and Profit Shifting (BEPS) by multinational enterprises. It allows jurisdictions to transpose results from the OECD/G20 BEPS Project, including minimum standards to implement in tax treaties to prevent treaty abuse and “treaty shopping”, into their existing networks of bilateral tax treaties in a quick and efficient manner.

The text of the MLI, the explanatory statement and background information are available on OECD website along with the list of the 71 jurisdictions participating in the MLI and the position of each signatory under the MLI.

The CRS MCAA is a multilateral competent authority agreement based on Article 6 of the Multilateral Convention on Mutual Administrative Assistance in Tax Matters, which aims to implement the automatic exchange of financial account information pursuant to the OECD/G20 Common Reporting Standard (CRS) and to deliver the automatic exchange of CRS information between 101 jurisdictions by 2018.

The text of the CRS MCAA, background information and the list of the 94 signatories are available on OECD website. Saint-Amans explained that the agreements will provide “automatic exchange of tax and financial information among 101 tax jurisdictions and enhance the ability of countries to contain tax avoidance and evasion.

It would be recalled that Fowler has said with the introduction of Voluntary Assets and Income Declaration Scheme (VAIDS), no Nigerian can evade tax payment.

According to him, the board has received positive response so far on the scheme. To improve tax compliance, the Federal Government said tax offenders stand to enjoy 29 per cent waiver on overdue taxes if they take advantage of VAIDS. The VAIDS programme is aimed at reducing tax payers’ liability and creates more awareness on the statutory function of every working citizen to pay tax.

The scheme which started July 1, offers a window for those who, before now, have not complied with extant tax regulations to remedy their positions by providing them limited amnesty to enable voluntary declaration and payment of liabilities.

Source: Leadership

Nigeria Launches Nation-wide Tax Payment Campaign

As the Nigerian government seeks to increase its non oil revenue, the

Federal Inland Revenue Service (FIRS) has launched a nationwide campaign to enlighten and educate the public on the need to pay tax.

The campaign tag tax Thursday sensitization program is aim at implementing the the voluntary assets and income declaration scheme (VAIDS) launch by the present administration and increase the level of payment in nigeria

The campaign team visited market places, departmental shops and super market as well as shopping malls to educate traders and members of the public on payment of tax and its accrued benefits.

Unveiling the campaign in abuja, the executive chairman FIRS Mr. Babatunde Fowler said the need to increase government revenue cannot be over emphazised adding that the campaign would continue every thursday to raise tax awareness and result in massive enrollment of new tax payers.

Tax Thursday’ would continue every Thursday for the next one year, as part of efforts by the federal government to raise the consciousness of Nigerians on tax as a major source of revenue for the country.“The only way we can make Nigeria sweet is to start paying our taxes,”

Mr.fowler said the aim is to encourage nigerians to pay tax as it is being done in other part of the world.

“We have come out with the VAIDs programme, which gives everybody the opportunity to come out and declare their income and pay their contributions to ensure that Nigeria becomes a better place for all.
“I’m sure if we all contribute, Nigeria of our dreams will emerge. It will become a prosperous and conducive country to live in. Let’s join hands together to realize this dream by paying taxes,” Mr. Fowler said.

With the misconception of Nigerians on paying tax, chairman association of Nigerian traders, fct, edozie ogwu said the government a need to collaborate with traders for an effective tax inclusion
”We want to appeal to them to them to collaborate with us in some areas, we are ready to pay our taxes because without taxes, we cannot make the country work. We thank you for giving us the opportunity to regularize our taxes,” Mr. Ugwu said in its quest to achieve a broader tax base, the Nigeria Governments VAIDS programme offers a grace period from july 1, 2017 to march 31, 2018, for tax evaders to voluntarily pay back to government what they owe.

In exchange for full and honest declaration, the government promises to waive penalties that should have been levied and also waive the interest that should have been paid on overdue tax.

Nigeria’s tax compliance rate currently stands at 6%, whilst most developed nations records between 30-32%.


FIRS Generates N778bn in First Quarter 2017

The Federal Inland Revenue Service (FIRS) says it generated N778.19 billion revenue in the first quarter of 2017.

This is according to a progress report by the FIRS sent to the Federal Ministry of Finance, and obtained by the News Agency of Nigeria (NAN) on Tuesday in Abuja.

The report, which showed the revenue performance for the first quarter of 2017, gave a breakdown of money collected.

According to the report, the FIRS collected N338.3 billion as Petroleum Profit Tax between January and March, as against the N176.7 billion collected in the period under review in 2016.

Similarly, Value Added Tax (VAT) revenue increased from N198.7 billion in first quarter of 2016, to N221.37 billion in first quarter of 2017.

The report showed that the biggest improvement was from Education tax collection, which the FIRS surpassed in 2016 by 311.7 per cent.

It said in first quarter of 2017, N33.9 billion was generated as Education tax revenue as against the N8.24 billion generated in the same period of 2016.

Also, the service said it achieved 284.3 per cent improvement in Stamp Duty collections, as it generated N3 billion in first quarter of 2017, as against the N785 million generated in 2016.

The report also showed that consolidated tax revenue for the first quarter of the year grew by 123 per cent, from N11.5 billion in 2016 to N25.7 billion in the same period of 2017.

The service also recorded success in boosting its collection of National Information Technology Development Fund (NITDEF) levy, which went up from N129 million in 2016 to N179.2 million in 2017.

The report, however, showed that the FIRS did not record any improvement in Company Income Tax and Capital Gains Tax collections.

The service collected N155.6 billion as Company Income Tax in first quarter of 2017, while it collected N166.85 billion in the same period of 2016.

It said N110.9 million was generated from Capital Gains in 2017 as against the N859.1 billion generated in the same period of 2016.

“The analysis shows that we have recorded an increase of N214 billion, representing an overall increase of 38 per cent in 2017, when compared with the collection performance of the corresponding period in 2016.

“We attained this collection performance in spite of several challenges, as we have continued to vigorously pursue our strategies internally, while improving collaboration with relevant stakeholders to boost our collections.

“The strategies put in place are still on course and progressively yielding,’’ the FIRS said.

It will be recalled that the FIRS Chairman, Mr BabaTunde Fowler pledged to improve tax collection by capturing more people and companies under the tax net.

In April, he said that four million individuals have been included in the tax net, bringing the total to about 20 million individuals.

This still leaves a gap of about 40 million taxable individuals and corporate organisations both in the formal and informal sectors.


CBN, FIRS, 32 Others Operating Without Approved Budgets

The Senate on Tuesday expressed displeasure at the Central Bank of Nigeria (CBN), Federal Inland Revenue Service (FIRS) and 32 other parastatals and agencies of government who are yet to submit their 2017 budget proposal eight months after due date.

According to the Senate President, Bukola Saraki, this infers that such agencies were operating without an approved budget and contrary to public expectations of an anti-corruption administration.

Other agencies yet to submit their budget are: The Central Bank of Nigeria (CBN), Federal Inland Revenue Service (FIRS), Nigerian Electricity Regulatory Commission (NERC) Oil and Gas Free Zones Authority, Nigeria Nuclear Regulatory Authority, Nigerian Ports Authority (NPA), National Maritime Authority, Nigerian Shippers Council, Federal Airports Authority of Nigeria and Securities and Exchange Commission (SEC).

Others are: Nigerian Customs Service (NCS), Nigerian Civil Aviation Authority (NCAA), Radio Nigeria, Federal Housing Authority (FHA), Nigerian Television Authority (NTA), National Automotive Design and Development Council (NADDC), National Sugar Development Council (NSDC), Nigerian Tourism Development Corporation (NTDC), National Communications Commission (NCC) National Agency for Food and Drugs Administration and Control (NAFDAC), National Broadcasting Commission (NBC) among others.

The Senate therefore threatened to stifle the agencies of funds such that they would only be able to pay salaries, if they failed to submit their budget.

Deputy Leader of the Senate, Senator Bala Ibn Na’Allah who drew the attention of his colleagues to the illegality said that the agencies were so far spending money that had not been appropriated by the legislature.

He said “I deliberately decided that I will bring it on the floor, so that Senators will understand the implications.

“In our commitment to assist this government to fight corruption, we must stand on our feet that every spirit of our law must be obeyed by those holding public offices.

“I think that if you permit me I will like to come tomorrow by way of motion, so it can be debated on the Floor of the Senate.”

“The only approach this Senate can take to assist this government in fighting corruption, is to insist that gross abuse of power and misuse of power must be stopped by every government agency.

“The only way we can build our institutions is to radically address the issue of abuse of power and misuse of power,” he said.

Senate President, Dr. Abubakar Bukola Saraki, added that “We are already in May. How can Parastatals be operating without any budget, especially in this time of the fight against corruption and ensuring that there is transparency in governance?

“We need to take this matter seriously because clearly these agencies are just flouting the guidelines and breaking the law.

“This is a very serious issue because as we all know, in line with the Fiscal Responsibility Act, these budgets are meant to have been submitted to the National Assembly since August 2016.

“They are supposed to have come with the Appropriation document. We have now passed the 2017 budget without the budgets of the parastatals.

“I think this matter really needs to come up as a motion because this is a very serious matter. We need to debate it…

“I think once and for all, we need to address this issue and put an end to this disregard for laws and areas of corrupt practices,” Saraki said.

The Nigerian National Petroleum Corporation (NNPC), Bureau for Public Enterprises (BPE), National Deposit Insurance Corporation (NDIC) and the National Agency for Science and Engineering Infrastructure (NASENI) have all concurred.

FIRS Seals Bolingo Hotel

The Federal Inland Revenue Service (FIRS) has sealed Bolingo Hotel in Abuja over property variation of about N320 million and non-remittance of Value Added Tax (VAT) of N20 million.

A reliable source disclosed this to the News Agency of Nigeria (NAN) on Wednesday in Abuja

“ It is FIRS that sealed the hotel, I learnt that the hotel is owing in a property variation and remittances of VAT.

“ The hotel is owing property variation of about N320 million and VAT of about N20 million,” the source said.

In the last quarter of 2016, the Bolingo hotel was sealed by FIRS over tax evasion.(NAN)

Nigerians in Diaspora Remitted $35 Billion Home

WITH two weeks to the end of the year and many Nigerians abroad expected to travel home for the yuletide, it came to light on Tuesday that Nigerians in the Diaspora sent $35 billion home.

This was disclosed by the Chairman of Federal Inland Revenue Service (FIRS) who also gave assurance that Nigerians living abroad will be favourably considered if they apply for tax waivers in setting up businesses at home.

Senior Special Assistant to the President on Foreign Affairs and Diaspora matters, Abike Dabiri-Erewa made the remittances revelation when she paid a courtesy visit to the Chairman, Federal Inland Revenue Service (FIRS), Babatunde Fowler and other members of his executive board.

“In 2016 they remitted $35 billion which is higher than what was remitted in 2015. This highest in Africa and the third largest in the world remittance by Nigerians living abroad,” she said.”

FG Reviewing Tax Laws – Adeosun

The federal government has commenced the redrafting of the nation’s tax laws.

Minister of finance Mrs Kemi Adeosun made this disclosure Thursday in Abuja when she met with tax experts.

According to Adeosun, “An overhaul of our tax code is long overdue as so is the redrafting of our tax laws to reflect current business practices and new trends. We must respond to the growing phenomenon of base shifting and other practices that allow companies to evade their fiscal and legal responsibilities.”

She disclosed that the Federal Government plans to engage with relevant members of the National Assembly to ensure that required revisions, amendments and new laws can be passed expediently to keep pace with the rapid change in business practices.

The Minister explained that the nation’s tax system must be dynamic in order to respond to an ever-evolving commercial landscape and to increasingly technology-driven business models.

She stated that the Federal Government, as part of the drive to increase non-oil revenue, has set an aggressive target for increasing tax collection. This, according to her, is a reflection of the fact that the current level of compliance is low and in some cases, the effective tax rate paid by those that are compliant is lower than expected. She added that the commendable administrative efforts of FIRS would be complemented by an overhaul of the tax code and tax laws.

She further stated that “We will critically examine our GDP to align taxes with economic activity in our bid to block all leakages. For example, the multi-billion naira losses being identified in our solid minerals sector by illegal and undocumented miners will be addressed with increased formalisation and review of the governing laws. Indeed, we are committed to the continuous improvement of our tax system as part of a dynamic framework. We will use tax administration and technology to widen compliance and encourage more individuals and companies into the tax net”, adding that the Federal Government is already investing in technology to boost the efficiency of our collections.

According to her, some of the recent initiatives being implemented in the Ministry of Finance mean that it is now virtually impossible to obtain a payment from the Federal Government without being fully taxed compliant.

Promising that tax revenues will be judiciously utilised going further, Mrs. Adeosun stated that tax payment is part of the social contract between Government and people and that the most effective measure to enhance compliance is the knowledge that tax revenues are being utilised effectively for the development of the people. The Minister explained that the Federal Government is already implementing public financial management reforms to strengthen financial controls and ensure greater accountability, while the government is also making progress to ensure value for money in every naira spent in its efforts to reduce overhead and increase the efficiency of government expenditure.

She explained that growing the economy at a rate that will address the employment needs of our huge population requires a fundamental change in how government collects its revenues and spends.The Minister said Government is committed to making sure that every naira counts. “We have strengthened our controls and made significant progress in enhancing the effectiveness of our financial expenditure in bringing development to Nigeria.”

The Minister further commented that “the commercial opportunities in Nigeria, despite our current challenges, are compelling and I am happy to report that we are now witnessing an increasing level of interest from long term investors who are keen to participate in the Nigerian upside as this government begins to position Nigeria to attain its true potential. It is particularly gratifying that the majority of these enquires relate to the non-oil sector. However, as encouraged as I am about these developments, I am concerned about the ability of our tax system to adequately develop and deploy effective measures to ensure that government revenue is mobilized in line with these developments.”

FIRS To Generate N4.9tn In 2016

The Federal Inland Revenue Service (FIRS) says it is targeting a revenue of N4.9 trillion in 2016.

Chairman of FIRS, Mr Tunde Fowler, disclosed this on Monday at the opening of the 134th Joint Tax Board meeting in Kano.

He assured that 80 per cent of the targeted amount would be collected before the end of the year.

“It is a known fact that once the oil price drops, the revenue from the sector will drop.

“So, our mandate now is to ensure increase in the non-oil revenue to ensure stability in the entire system,’’ Fowler said.

He said that the meeting would address challenges militating against effective tax administration in the country.

He recalled that the Inspector-General of Police had dismantled all road blocks across the country as part of efforts to check indiscriminate and multiple tax payment.

“The meeting will also review all the existing tax laws with a view to ensuring their effective implementation for great result,’’ he said.

Fowler called on the participants to come up with useful suggestions to improve revenue from tax in the country.

Earlier, Kano State Commissioner for Finance, Prof. Kabir Dandago, said the state government would continue to support measures aimed at improving internal revenue generation, not only for the state but for the country.

The News Agency of Nigeria (NAN) reports that the theme of the meeting is: “Imperatives of Transitioning from Oil Revenue Dependency to Non-oil Revenue Sufficient.’’

It was attended by heads of board of internal revenue service from the 36 states and the Federal CapitalTerritory. (NAN)

FIRS Director Arrested For Tax Fraud During Sting Operation

The Economic and Financial Crimes Commission, EFCC, has arrested Abumere Joseph Osagie, deputy director, regional tax office, Federal Inland Revenue Service, FIRS, in a case of abuse of office and bribery.

The suspect was picked following a complaint about his attempt to extort a university proprietor N5 million.

Osagie and Jamila Ojora had on January 27, 2016 allegedly approached Senator Ahmed Datti, the Chancellor of Baze University, Abuja and gave him a tax assessment of N20,029,496 through a letter of intent, which he paid.

However when he requested for the assessment certificate, they refused to oblige him. Instead they allegedly demanded for N5 million gratification.

All pleas by him fell on deaf ears. Consequently, he petitioned the EFCC, and was advised to play along.

Consequently, marked N5 million was delivered to the director through Ojora in a sting operation.

Ojora was arrested after she collected the N5m. He confession led to the arrest of Osagie.

The houses of the suspects were searched by operatives of the EFCC, and documents were recovered.

Investigations continue.

Fowler Redeploys 26 FIRS Directors

The Executive Chairman, Federal Inland Revenue Service, FIRS, Babatunde Fowler, has ordered the immediate restructuring of the management of the agency with the transfer of 26 top officials in the directorate cadre to different positions in various locations across the country.

Under the exercise, the chairman introduced the State Coordinator structure in the FIRS to help widen the net to capture more registered corporate and individual taxpayers towards increased revenue generation.

The Head of Communication & Servicom Department, Wahab Gbadamosi, explained in a statement that each of the 13 State Coordinators would supervise operations in their areas of jurisdictions of posting.

Two directors were moved to the headquarters in Abuja, while three are expected to coordinate affairs in the states.

“Experienced deputy directors were transferred to FIRS’ Training School and centres across the country as part of the efforts of the Service to strengthen its knowledge transfer programme and expeditious development of the capacity of its workforce in the interim,” Mr. Gbadamosi said.

The State structure, he said, was part of the new FIRS Chairman’s vision of minimizing the span of control, closer focus on corporate taxpayers in all states of the federation and stronger collaboration with State Boards of Internal Revenue, SBIR, to increase overall tax yield acruable to the three tiers of government.

Under a new campaign to widen the tax base, the FIRS spokesperson said FIRS registered additional 359,158 corporate taxpayers within 107 days between October 13, 2015 and January 27, 2016.

He said the FIRS chairman plans to add at least 500,000 new corporate taxpayers by 31st March 2016.

To widen the tax base further by an additional five million new individual taxpayers to the countrywide tax register by December 2016, the FIRS Chairman plans to work with states under the Joint Tax Board, JTB, structure.

Those affected by the latest posting include the Director of FCT and North Central Region, Olufemi Faniyi, who was posted to the Compliance Support Group, while Director, South-South and South-East Directorate Department Innocent Ohagwa, is now Acting State Coordinator, Akwa Ibom, Bayelsa and Cross River States.

Director, Lagos Mainland (East and West Directorate) Department Gbolaga Oshiga, is now Acting State Coordinator, Ogun, Oyo and Osun States, while Director, North-West and North-East Regions Directorate Department, Mohammed Magam, becomes the Acting State Coordinator, Kebbi, Sokoto and Zamfara States.

Director, Oil and Gas Department, Lagos, Olufunlola Adediran, was transferred to the Office of the Coordinating Director, Domestic Tax Group in Abuja.